Economy
AI
Estonian Manufacturing Boom Offsets Steep Energy Decline
Estonian industrial production increased by 1.7% in 2025, a gain entirely powered by a robust 3.1% expansion in the export-heavy manufacturing sector that compensated for significant contractions in the nation's mining and energy industries.
- —Estonian industrial enterprises produced 1.7% more output in 2025 compared to the previous year, with manufacturing sector growth reaching 3.1%.
- —While manufacturing saw a significant increase, mining and energy sectors experienced declines of 0.9% and 8.5% respectively.
- —The manufacturing sector's production volume grew for eight consecutive months, with a temporary slowdown in September and October before recovering towards the end of the year.
- —Key sub-sectors within manufacturing that saw growth include electrical equipment, metal products, and food production, while the production of machinery and equipment and oil shale extraction decreased.
- —Over 66% of the manufacturing sector's output was sold on external markets, with exports increasing by 3.3% in current prices.
Recap
Estonia's modest 1.7% industrial growth in 2025 conceals a significant economic divergence. A thriving, export-driven manufacturing sector is pulling the entire index upward, while the country's mining and energy industries face substantial, unexplained declines. This split indicates a structural shift, leaving the economy increasingly dependent on international market demand for its manufactured goods while grappling with domestic challenges in its foundational energy production.